The 'Section 194N' of Income Tax Act deals with TDS on: MCQ with Answer and Explanation

The 'Section 194N' of Income Tax Act deals with TDS on:
A. Commission
B. Professional fees
C. Cash withdrawals exceeding certain limits from bank accounts
D. Rent
Answer: Option C
Solution (By JKSSB Mock Tests)
TDS at 2% on cash withdrawals exceeding ₹1 crore (or ₹20 lakh for non-filers of returns).

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Practice More Accountancy and Book Keeping Questions

Question #1
In the context of recent developments, what is the full form of 'Ind-AS'?
A. Internal Accounting System
B. Indian Audit Standards
C. Indian Accounting Standards
D. International Accounting Standards

Correct Answer: Option C


Explanation:
Ind-AS stands for Indian Accounting Standards, which are the standards converged with IFRS (International Financial Reporting Standards) and notified under the Companies Act.

Question #2
A 'Flexible Budget' is most useful because it:
A. Only targets cash flows
B. Can be changed by managers without approval
C. Assumes all costs are fixed
D. Shows expected costs at various levels of actual production

Correct Answer: Option D


Explanation:
Unlike a static budget, a flexible budget adjusts based on the actual activity level, providing a realistic benchmark for variance analysis.

Question #3
A: The Accounting Equation is Assets = Liabilities + Capital. R: This equation is based on the Dual Aspect Concept. Choose the correct option.
A. Both A and R are true but R is NOT the correct explanation of A
B. A is true but R is false
C. A is false but R is true
D. Both A and R are true and R is the correct explanation of A

Correct Answer: Option D


Explanation:
The accounting equation represents the balance sheet. It is derived from the Dual Aspect Concept, which states that every transaction has two equal and opposite effects, ensuring the equation always balances. R correctly explains A.